After AMC (AMC) - Get AMC Entertainment Holdings, Inc. Class A Report “crushed” second quarter results, CEO Adam Aron deserves quite a bit of credit for the accomplishment. Under his leadership, AMC’s business has been showing early but encouraging signs of recovery.
Also, the CEO reinforced his good relationship with the ape community, one of the key pillars of AMC’s recovery this year. Wall Street Memes discusses why Adam Aron might be considered “one of the greatest business people”, a title recently given to him by Mad Money’s Jim Cramer.
(Read more from WS Memes: AMC Stock: Dark Pool Regulation Could Fuel The Short Squeeze)
As a former CEO of the Philadelphia 76ers (currently co-owner), Norwegian Cruise Line (NCLH) and Vail Resorts (MTN), Adam Aron has been successful in every company that he has led. At the helm of AMC today, the same seems to be true, despite the immense challenges of late.
Since 2015, Adam has been the CEO of AMC Entertainment. He has been consistently praised for transforming AMC and shaking up the movie theater business.
However, his biggest career challenge began last year, with the COVID-19 pandemic. Due to the lockdowns, AMC was forced to close all of its theaters, which put the company on the edge of bankruptcy.
Luck follows the successful
Adam Aron was unknown to the masses until the surge of meme mania. With the help of the ape community, AMC share price rose to stratospheric levels and became one of the most popular stocks in the entire exchange.
Due to the company being the target of massive short selling, Reddit forums organized by retail investors made a push to buy AMC shares en masse. The efforts resulted in a spike in the company's market cap from $300 million in early 2021 to the current $16 billion.
Following AMC's rally, in June, 11 million new shares were issued, which enabled AMC to raise hundreds of millions in equity and gave an unexpected boost to the company's liquidity. The impact was felt in last period’s financial results. "The second quarter of 2021 was transformational for AMC," said CEO Adam Aron.
Apes being valued
Ape commitment has been crucial for the company to raise large quantities of cash. It is not hard, therefore, to understand why Adam Aron values his individual shareholders so much. Recently, he listened to them and declined the issuance of another 25 million shares—which would have brought another pile of cash to AMC's vaults.
In addition, the CEO has been very active and open to dialogue with the apes. According to him, many ideas suggested by shareholders were considered, including a possible partnership with Ryan Cohen from GameStop and the inclusion of bitcoin as payment in movie theaters — the latter having already been executed. Also, in the last earnings call, AMC opened the floor for direct Q&A with individual shareholders, which is quite unusual among publicly traded companies.
However, the CEO very carefully hinted that he will likely sell some of his shares in the near future to rebalance his personal equity since he has not yet sold any of his 758,747 common AMC shares. We have not seen much pushback from the ape community on his decision.
Best CEO ever?
Overall, CEO Adam Aron seems to enjoy a status of leadership among the apes, which he has earned by putting retail investors at the center of the conversations. Such status and his wiliness to listen, in turn, have benefitted the company (think of the equity issuance), creating a virtuous cycle that seems to please the shareholder base.
(Read more from WS Memes: AMC Q2 2021 Earnings: Live Blog For Investors)
How much do you trust that AMC’s CEO Adam Aron will turn the company around and help to push the stock price higher?
(Disclaimers: this is not investment advice. The author may be long one or more stocks mentioned in this report. Also, the article may contain affiliate links. These partnerships do not influence editorial content. Thanks for supporting Wall Street Memes)